Mark IV's US auto works file for bankruptcy, E-ZPass supplier OK

Mark IV Industries major automobile-related businesses have filed Chapter 11 bankruptcy in federal bankruptcy court in New York City. This is the big brother to the Intelligent Vehicle Highway Systems division of Mark IV Industries that makes electronic toll systems, notably the transponders and readers for the E-ZPass Inter Agency Group.

In bankruptcy is the Power Transmission division of Mark IV which makes fan belts, hoses, air filters and other components for automobile manufacturers.

Hit by the collapse of GM and Chrysler and drastically reduced sales by other auto manufacturers the company has been closing plants and laying off workers. The company says Ch 11 should allow it to shed debt and strengthen its financial position. JPMorgan Chase is leading a group which will inject $90m of new capital into the company if the restructuring is approved by the court.

IVHS which supplies E-ZPass IAG transponders and reader systems out of a plant in Mississauga near Toronto's Pearson Airport is a small part of Mark IV with annual sales of about $60m or 4% of total Mark IV sales of close to $1400m.

IVHS has about 150 employees our of all Mark IV's 4000-plus.

BACKGROUND: Mark IV was started by Sal Alfiero a Buffalo NY businessman in 1969 to make auto parts, and grew to employ 16,000 people through western New York, Ohio, Indiana and Ontario and was listed in the Fortune 500 list at its peak in the early 1990s - at which time the IVHS Division was formed.

Mark IV Industries was bought by a private British group BC Partners of London in 2000. In early 2008 BC Partners sold Mark IV to its current owners Sun Capital Partners Inc, a private international company run by a pair of New York bankers and graduates of the Wharton Business School in  Philadelphia PA - Rodger Krouse and Marc Leder.

Sun Capital has its largest office in Boca Raton Fl, but it also has offices in New York, Los Angeles, London, Shenzhen, Shanghai, Paris and Frankfurt.

Sun Capital Partners have invested in and managed 200 companies worldwide since their inception in 1995, and currently list about sixty companies they own.

They have aggregate sales of $40 billion and about 170k employees. They say they would rank in the top 100 of Fortune Magazine's listing of the 500 largest companies in the United States.

Investments have included paper and packaging, food and beverages, metals and mining, automotive after-market parts, consumer products, financial services, healthcare, media and communications, building products, telecommunications, technology, retailing and catalogs, restaurants, manufacturing and industrial, among others.

Sun Capital has more than $9 billion of equity capital under management.

The group often "bridges" the entire purchase price of at closing; raising permanent debt financing afterwards.

The company claims to be one of the few private equity firms that has completed all transactions to which it has committed, despite the difficult financial environment of the past two years.

This is heavily based on material at http://www.suncappart.com

TOLLROADSnews 2009-05-03